Why the Indus Water Treaty is being debated in India

Ever since the attacks on the Indian Army base at Uri by four terrorists identified by India as members of the Pakistan based terrorist group Jaish-e-Mohammed, there has been a growing demand by the Indian public that its government must act tough on Pakistan. Of the various options mooted, one of them was to revisit the Indus Water Treaty in order to send Pakistan a strong message.

Although the public outrage has relatively eased after the Indian Army conducted surgical strikes across the Line of Control to dismantle terror launchpads in PoK, the Indus Water Treaty nevertheless continues to be discussed in the broader discourse. While some have called for abrogation of the lopsided treaty, others have suggested India should make full use of the waters, which it has not done so far, within the provisions of the treaty. But any evaluation of this matter must be cognisant of both these facts: the treaty is grossly unfair to India and that there is no tap that can be turned off to stop the Indus waters.

Signed in 1960 by Indian Prime Minister Jawaharlal Nehru and Pakistan’s President at the time Ayub Khan, the Indus Water Treaty was brokered by the World Bank. It is an extraordinarily generous water sharing treaty, and is the only pact in the world that compels the upper riparian state to defer to the interests of the downstream state. The treaty gives Pakistan control over the three so-called ‘western’ rivers of Indus, Jhelum and Chenab that flow from the Indian state of Jammu & Kashmir before entering Pakistan. On the other hand, India gets to control the three eastern rivers of Ravi, Beas and Sutlej that flow from the Indian state of Punjab. This parity in the number of rivers is, however, quite misleading. The three rivers that India gets to control have awfully low volume of waters compared to the other three. In all, Pakistan gets a whopping 5,900 tmcft volume of water every year which is a massive 80.5% share of the total waters, while India gets to use only 19.5%.

What’s ironic is that Pakistan gobbles up all of this water even though its actual requirement is much less. It is egregious that annually about 40 million acre feet (maf) of water flows into the Arabian Sea absolutely unutilised, according to a study by an Indian Supreme Court Advocate. If even some of these waters were allowed to be utilised by India, the water crunch in the states of Haryana, Punjab and Rajasthan could probably be solved. Further, the Indian state most affected by the treaty is Jammu and Kashmir. The people and government of Jammu and Kashmir have time and again raised this issue. In 2002, the state assembly passed a unanimous resolution demanding the abrogation of the pact, when Mufti Mohammed Sayeed was the Chief Minister. Given the power shortages in the state, full access to Indus waters has the ability to boost self-reliance which is key to solving the state’s problems. Pakistan however has a vested interest in continuing the status quo because it harms the people of Jammu and Kashmir and undermines their economic growth.

Even though under the treaty India has the right to ‘non-consumptive’ use of the western three rivers, which is for purposes such as hydro power generation and even storage upto 3.6 million acre feet, India has hardly made any use of these waters, allowing Pakistan to benefit from the surplus. Even for the few projects that India has undertaken such as the Kishanganga and Ratle projects well within the treaty framework, Pakistan has unabashedly taken them to international arbitration over petty objections, in effect stalling the projects resulting in obvious implications such as cost overruns. Meanwhile as the Indian projects are halted, Pakistan itself is busy erecting dams to make its case stronger. Ironically, China too has stealthily built a dam on the Indus at Demchok in Ladakh.

The Indus Water Treaty came into recent spotlight when the spokesperson India’s Ministry of External Affairs Vikas Swarup on 22nd September hinted at a press briefing that India may revisit it. “I am sure you are aware that there are differences between India and Pakistan on the implementation of the Indus Waters Treaty”, he said before adding that the issue is being addressed bilaterally and that all cooperative measures call for mutual trust and goodwill on both sides. “For any such treaty to work, it is important there must be mutual trust and cooperation. It can’t be a one-sided affair,” Swarup said.

Largesse be it in the case of river waters or other resources like land, marine resources, etc. is not uncommon in diplomacy. India has a proven track record of making magnanimous overtures to its neighbours. The recent land boundary agreement with Bangladesh is a fine example of how India is willing to walk the extra mile if the partner country is able to reciprocate with a sense of goodwill and positivity. But Pakistan is no Bangladesh or Bhutan.

There is neither mutual trust nor goodwill, which were the foundational basis of the Indus Water Treaty, between India and Pakistan today. For 56 years of uninterrupted and unquestioned flow of waters from India to Pakistan, all India has got in return is the blood of its citizens. As Indian strategic affairs expert Brahma Chellaney wrote in his recent article, “If India jettisons the 1960 Indus Waters Treaty (IWT), it can fashion water into its most potent tool of leverage to mend Pakistan’s behaviour. Pakistan has consistently backed away from bilateral agreements with India – from the Simla Agreement, to the commitment not to allow its territory to be used for cross-border terrorism… It cannot selectively demand India’s compliance with one treaty while it flouts a peace pact serving as the essential basis for all peaceful cooperation, including the sharing of river waters.” Chellaney has also pointed out that Pakistan’s use of state-reared terrorist groups can be invoked by India, under Article 62 of the Vienna Convention on the Law of Treaties, as constituting reasonable grounds for withdrawal from the Indus treaty.

The Indian government has for now not decided to abrogate the treaty, but would be ‘maximising’ the use from the western waters under the ambit of the treaty. In a high level review meeting, Prime Minister Modi has said that “blood and water cannot flow at the same time”, indicating a firm stance. The government has also decided to suspend the meeting of Indus Water Commission until further notice, pointing out that such engagements need an atmosphere free from terror. Pakistan must realise that if it does not mend its ways and stop cross-border terrorism, India could escalate further. With every misadventure Pakistan undertakes, the costs will be raised by India. The Indian government’s signal to Pakistan is clear – it is not going to be business as usual if Pakistan continues to bleed India.

India’s Military Spending and South Asian Security

Over the past several years, unprecedented military modernization in Pakistan’s immediate neighbour, India, has worsened South Asia’s security environment. India’s heavy military spending and its unstoppable quest for the acquisition of sophisticated weapons have threatened regional stability. Indian desire to acquire global power status through military means has further been intensified as a result of US assistance particularly in former’s defence sector. Within quick span of time, defence trade between India and the US has shot from $1 billion to over $15 billion leaving other regional powers in the state of security consciousness.

India’s obsession with its military build-up doesn’t end here. According to the Stockholm International peace Research Institute (SIPRI) a prestigious international institute dedicated to research into conflict, armaments, arms control and disarmament, India, once again tops the list as world’s largest weapons importer. This is not a new development as previously, India also topped the list for the same reason.

As per SIPRI estimates, Russia remains top arms supplier to India. However, surprisingly arms deliveries from the US increased more than six-fold in the five-year period to the India. This trend in long run will definitely reduce market space for Russian arms and ammunition to India.

Despite the fact that, India’s unbridled military modernization is the primary impetus behind South Asian instability, global power’s economic expediencies in South Asia also undermines delicate conventional parity between India and Pakistan. For instance, Indo-US strategic partnership, which apparently touted as US’ China containment policy, seems more of a Pakistan containment policy. Much of the US provided weapon-tech to India is more useful against Pakistan in a conventional warfare. Almost 70% of Indian military troops and weapon system are deployed against Line of Control, (LOC). Interestingly, peaceful settlement of Docklam issue between China and India as well as sky-rocketing bilateral trade between both countries, which has reached to $84.44 billion last year, makes prospects of conflict almost impossible.

However, in contrast to aforementioned facts, the influx of massive military hardware from western capitals to India continues and in certain cases the flow of arms has gained momentum. There are two primary motives behind India’s overwhelming spending in defence industry.

First, India aspires for greater role in global environment and in certain ways it has been demonstrating its will and capability to influence global dynamics. India’s successful test of Agni-5, a long-range ballistic missile, capable of carrying nuclear weapons with a strike range of more than 3,000 miles, is a practical demonstration of its military capabilities to influence other powers around the globe. For hawkish policy makers in New Delhi, a strong military power can extend India’s global influence.

Secondly, India is following a policy of coercion at regional level primarily, against Pakistan which shares history of hostility and violence due to longstanding territorial disputes such as Kashmir. There is growing perception in New Delhi that militarily strong India can dictate South Asian affairs. That’s why India has been consistently opposing diplomacy and dialogue for peaceful resolution of disputes. Therefore, to meet its foreign policy goals, which are based on coercion and usage of hard power, India spends massive in military build-up.

Ironically, South Asia is called as nuclear flashpoint due to history of animosity and violent conflicts between India and Pakistan. With its mighty military power, India has emerged as the most potent threat for not just Pakistan but also a security challenge for other powers in the region.

Given the advantage it has in terms of nuclear missiles, military hardware and submarine fleet, India has been trying to create an environment conducive to wage limited war against Pakistan. For that, India has not just developed its military doctrine, Cold Start Doctrine, but also initiated and sponsored sub conventional war in Pakistan’s chaotic province, Balochistan.

In such circumstances, Pakistan needs to maintain delicate conventional military balance vis-à-vis India. Despite the fact, Pakistan has been facing number of issues at national, regional and international levels which include on-going military operation in tribal areas to hostile border skirmishes; a robust military modernization plan has become inevitable. A militarily strong Pakistan will be able to maintain its territorial integrity against aggressive yet militarily mighty India.

It’s an open fact that Pakistan has consistently called for peaceful resolution of all outstanding disputes and it has offered to resume diplomacy and dialogue over Kashmir dispute. Unfortunately, India’s cold response has not only restricted Pakistan’s peaceful overtures but also refused to accept third-party mediation in peaceful settlement of Kashmir issue. This clearly shows that, current ruling regime in India is not serious for peaceful settlement, rather more inclined to use of force and coercion. Under such circumstances, Pakistan needs to strengthen its force posture to pre-empt any kind of misadventure from its adversary. However, Pakistan, as it has done in past, must embrace peaceful overtures to bring stability in the region.

US Call for a New Relationship

U.S. Secretary of State Rex Tillerson meets with Pakistan's Foreign Minister Khawaja Muhammad

‘Trust, but verify’ an Old Russian proverb that President Reagan liked to repeat often. Trump is neither the first President nor he is going to be the last to criticize Pakistan of deceit and threaten to cut off American assistance. Notwithstanding, the last six decades of the US support, the US has failed completely in cultivating an ally in Pakistan nor has it meaningfully changed the nature of its relationship with Pakistan, which can be best described as ‘transactional’. A quid-pro-quo relationship between the two has never been established with regards to the assistance they both offered to each other. In truth, United States has never really trusted Pakistan.

President Trump avowed in his New Afghan Strategy that the US has been paying Pakistan ‘billions of billions of dollars at the same time they are housing the very terrorists that we are fighting for’ but the mantra should be put to a halt. Likewise, the US must be conveyed boldly to stop continuing its false claims that Pakistan shelters the ‘agents of chaos’ and be reminded that friends don’t put each other on notices.

Similarly, statements and avowals that India now is a strongest ally to the US, disturbs Pakistan, chiefly because of the irony at Trump administration’s part which only sees the glittering Indian market but pay no heed to the growing Indian cease fire violations across the LoC and the atrocities India commits against the unarmed civilians of the Indian held Kashmir.

The recent visits and statements however by the senior US officials and Trump’s aides reflect the US call for a new relationship between the US and Pakistan, which once used to be close allies in the US led ‘Global War on Terror’.

Pakistan’s foreign policy makers at this point in time must be mindful of the fact that the US is a major trading partner and should adhere to a relationship more than ‘transactional’. Moreover, the risks and fears at the US part of ‘rampant destabilization and civil war in Afghanistan’ increments further the region already devoid of trust. For, nobody actually knows whether the US will stay or eventually leave Afghanistan.

The Afghan war has now become a war of logistics, in words of Sun Tzu ‘the line between order and disorder lies in logistics’, Pakistani supply lines thus provide Islamabad with a leverage in absence of shorter, cheaper and acceptable alternative routes. Given these circumstances, Pakistan should make best use of the US call towards a more robust bilateral relationship.

The move for a ‘new relationship’ and improved ties began last week with senior Trump aide’s visit to Islamabad to hold talks with Pakistani leaders. Earlier also the impressions that Pakistan and the US were on a collision course were dispelled by a top US general. Likewise, US department’s acting Assistant Secretary for South and Central Asia Alice Wells asserted that the US was not thinking of cutting its ties rather assured that the US still cogitate Pakistan indispensable to the resolve in Afghanistan.

The aforesaid developments clearly indicate that the strained US-Pakistan relations would improve soon and that the suspension in the military aid is also not permanent.

To conclude, achieving long term stability and defeating the insurgency in the region will be difficult without Pakistan’s support and assistance.

Special Economic Zones and CPEC

Economic Expansion, high prices and inflation are the issues on which one can talk for hours. The scarcity of resources, energy crises and lack of industrial modernization are the challenges which Pakistan has been facing for past many decades. Despite the advantages of geographical setting, the country could not sufficiently expand its economy until 20thcentury. However, the China-Pakistan Economic Corridor (CPEC) has brought with it various infrastructural, energy, and industrial projects that show smooth progress in these sectors. One of the most significant developments is the establishment of Special Economic Zones (SEZs) under the Long Term Plan (LTP) of CPEC.SEZ is a physically protected area with definite geographic boundaries under which the investors and the developers enjoy duty free benefits and streamlined procedures, set up by the government. After the successful completion of the Early Harvest Program (EHP), the governments of China and Pakistan aspire to complete the Long Term Plan (LTP) of CPEC. As a key route to success, the LTP has been divided into three phases and the work on the first phase has already started. SEZs are on the first priority list of the first Phase of LTP. While utilizing the strategic location of Pakistan and the rich resources, the SEZ will contribute a framework for Pakistan’s domestic industries, and local economy.

The government has planned to establish nine Special Economic Zones (SEZs) in all the four provinces, federal areas and Gilgit-Baltistan under the framework of CPEC, which would be completed in a period of three years. Pakistan has conducted feasibilities of 5 SEZs which focuses only on the infrastructure. The three prioritized SEZs to be completed in the first phase of LTP are M3 Industrial City in Faisalabad, Punjab, Chinese SEZ Dhabeji, Sindh and Hattar SEZ in KP province. While the remaining six sites include Rashakai Economic Zone, M-1 Noshera, Bostan Industrial Zone District Pishin, AllamaIqbal Industrial City, Moqpondass SEZ in Gilgit-Baltistan, ICT Model Industrial Zone Islamabad, Development of Industrial Park on Pakistan Steel Mills Land at port Qasim near Karachi, Special Economic Zone at Mirpur AJK, Mohmand Marble city.

Although, there are general misunderstandings regarding the industrial ramifications of the SEZ’s under CPEC due to large number of Chinese firms and the exemption in the tax rates offered to them. However, the LTP of CPEC shows that these SEZ’s will offer the country with a great opportunity to accelerate industrialization because they are beneficial for all the international and domestic investors. So far in the history, SEZs have been the reason of economic boost in countries around the globe. Now this is a matter of concern that either these SEZs will make Pakistan a center of economic modernization and trade ventures or not. The economist and financial experts are optimistic about Pakistan’s emergence as one of the fast growing and promising global economy.

While stepping towards the era of industrialization, Pakistan faces a number of issues that have so far refrain the industries to understand their growth potential. Some of the chief hindrances to investment in Pakistan include poor security; non-availability of infrastructure and power crises, rent-seeking regulators, and cumbersome tax administration, etc. among many others.

Likewise the entrepreneurs in Pakistan have certain reservation with the incentives proposed by the government and SEZs for the investors and enterprises including ten-year exemption from all taxes on imported capital goods and exemption from tax on income accruable from development and operations in SEZs for a period of ten years. Although these incentives will be beneficial for the foreign investors at large but at the same time it will provide Pakistani enterprises with the opportunity to collaborate with the Chinese firms and launch joint ventures of mutual interests and benefits. This will be further beneficial for the annual Gross Domestic Product (GDP) growth of Pakistan. Moreover it will bring Foreign Direct Investment (FDI) in the country thus generating the foreign revenue.

Subsequently it is significant to keep in mind that in Pakistan there are certain security and political factors due to which the SEZ’s may face challenges. Hence forth to conquer these challenges provincial harmony among all the provinces and mutual consensus between the public sector and private sector is needed. SEZs under CPEC will be a life-time opportunity for Pakistani companies to work together with Chinese companies for the development of export-oriented manufacturing industries. Therefore, Pakistan should increase its products in the Chinese market and raise the ratio of its export while decreasing the trade deficit by lowering the imports.